Message boards offer a great pool of information as well as opportunities to socialize with like-minded traders. Sometimes I post my advice on threads in which aspiring traders seek advice. Upon one post of mine, a trader messaged me this:
There will come a time where I will need to try to figure out my personal plan to be a trader and taking things into my own hands. Could you lend any advice to someone who has the ambition but has yet to even paper trade a “system” or “edge”?
Here was my reply to him. I would like to share it as I find it relevant for many traders:
Before you learn trading through painful mistakes, I suggest that you make printouts of charts and study them vigorously before testing your theory (either in paper trading, or with minimal amounts of real money). I personally printed out the continuous 1H chart of the ES from the last few years.
Know that experienced traders tend to be passive and ride out trends for as long as possible. Be objective in whichever approach you pursue. This is easily said, but what I mean is that you only enter a position when the market tells you to, not sooner and not later. Don’t trade what you expect, but merely according to what you see. You need to be able to clearly pinpoint the reason why you did something the way you did one month or a year from now. Only then will you have an objectively executed trade.
Last but not least, know when a trade is a failure before entering it in the first place. It means that you need a stop, or a risk limit. Decide based on what you see in the chart, not some 1% or 5 point distance rule relative to your entry. That is subjective. I hope this can help you with finding a smooth entry to becoming a good trader!
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